Tax Season Scams - Crime Clean AZ Tax Season Scams - Crime Clean AZ

Tax Season Scams

Tax Season Scams

  • 23 Mar Off

Are you aware of tax season scams?

I found this article in the February 15, 2015, Arizona Republic, timely and a reminder to beware!

These are the 12 top tax scams listed by the IRS.

The number one tax scam going is the phone scam… There has been a surge in aggressive and threatening phone calls by scam artists who impersonate IRS agents and falsely warn of potential arrest, deportation or license revocation, the IRS says.

Don’t be fooled by fake e-mails or websites purportedly asking you to submit a Social Security number or other identifying information. The IRS does not send unannounced e-mails or other electronic communications about tax bills or refunds.

Scammers who obtain Social Security numbers and personal information are increasingly using the information to steal taxpayer identifications and submit false tax filings seeking refunds. Despite its crackdowns on the fraud, the IRS estimates it paid $5.2 billion in improper identity theft refunds during the 2013 tax filing season.

Return Preparer Fraud

Most tax professionals are honest professionals. But taxpayers should beware of some who betray their clients’ trust committing refund fraud or identity theft. Choose prepares carefully. Be sure she or he has an IRS preparer tax identification number.

Offshore Tax Avoidance

Americans who have foreign accounts must report them to the IRS and disclose income on the assets. The Department of Justice has prosecuted dozens of violators in a multi-year crackdown on offshore tax evasion.

Inflated Refund Claim

Taxpayers should beware of a preparer or anyone else who promises larger-than-expected refunds. Beware of anyone who asks you to sign a blank tax return or promises a large refund without first examining your financial records.

Taxpayers should be on guard against groups that falsely pose as charitable organizations and seek donations that could justify tax deductions. Check the tax-exempt status of all groups before giving. Instructions at an IRS website show how.

Hiding Income with Fake Documents

Falsifying financial documents to reduce taxable income is illegal. Beware of a tax preparer or anyone else who advises to do this. Taxpayers are legally responsible for the accuracy of all information on the tax forms.

Questionable Tax Shelters

If a tax-shelter strategy or trust structure that reduces taxable income seems too good to be true, check it out before pursuing it. If the strategy uses unnecessary steps or a form that doesn’t reflect its substance, the IRS could deem it abusive.

Falsifying Income to Claim Tax Credits

Don’t heed anyone who advises you to “invent” income as a way to qualify for federal tax

Excessive Claims for Fuel Tax Credits

These credits are generally restricted to off-highway business use, such as farms.

Frivolous Tax Arguments

Be skeptical about anyone who cites claims or programs that say you’re not required to pay taxes. Many of these arguments have been dismissed by court rulings. There’s a $5000 IRS penalty for filing a frivolous tax return. Remember that age-old advice: Don’t mess with the tax man-and woman.

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